We view trust as the most important attribute with any third-party logistics (3PL) provider. The top 3PLs have all earned significant trust. And as important as that is, there are other factors to consider when looking for a fulfillment partner, which can be dependent on the type and size of your ecommerce business.

Below, I have provided a list of 7 things to look for in prospective 3PL partners, and I’ve done it from the perspective of both small and larger businesses. I want to confirm that all of these traits are extremely important, regardless of how much order volume you’re doing. However, to find the best fulfillment service for your ecommerce business, you may need to weigh certain attributes more heavily than others.

Best Fulfillment Centers & Services for Small Businesses

Attribute

Priority

Trust

1

Support

2

Flexibility

3

Technology

4

Ownership

5

Pricing

6

Location

7

Best Fulfillment Centers & Services for Large Businesses

Attribute

Priority

Trust

1

Support

2

Pricing

3

Location

4

Technology

5

Ownership

6

Flexibility

7

Trust & Support

These are the two most important factors for a business of any size.

Merchants need to be able to trust that their fulfillment company will consistently get orders out correctly and on time. As importantly, when mistakes are made, merchants need to be able to trust their 3PL partner to do the right thing.

From a support standpoint, your business size is also irrelevant. If you have an issue with one of your orders, you need an answer fast, as a slow response could mean a lost customer.

This is one particular area that eFulfillment Service is consistently ranked at the top among fulfillment centers, with response times and resolution times that far exceed industry standards.

Flexibility

By flexibility, there are primarily two things I’m referring to here…

Requirements

The first is whether or not the 3PL has certain requirements relative to order volume, order weight, SKU counts, total inventory storage volume, or the length of the engagement.

These requirements often affect smaller businesses more than larger businesses, which is why I ranked it as more important for smaller merchants. For a smaller seller, they generally need a fulfillment center with more flexibility, meaning they won’t be penalized if they do a low number of orders, or certain products don’t move fast enough, or they need to end the engagement after six months because sales are lacking.

For larger businesses, some flexibility is still required, such as the need to be able to carry a large number of SKUs as well as some slower-moving inventory; however, the types of requirements I referred to above don’t generally impact these larger sellers as much.

Special Requests

Another consideration that falls under the “Flexibility” category is the 3PL’s ability to accommodate special requests.

For merchants with high order volume and straightforward work, this special accommodation may be rarely required. However, for merchants of all sizes, there will always be the occasional need to expedite an order, or do an inventory transfer, or to push new merchandise to the front of the receiving line to get backorders out.

When order fulfillment is handled in-house, merchants don’t need to worry about this as much, as they can allocate their staff however they’d like. When outsourcing, however, this type of flexibility needs to be a big consideration, as a rigid 3PL partner can hurt your business. The best fulfillment centers have the ability to handle these types of special requests.

Technology

When using a 3PL, it needs to be seamless for the merchant, and this is where technology plays a key role.

Most fulfillment companies integrate with some shopping carts, allowing them to pull in merchant orders automatically. However, some 3PLs integrate with more platforms than others, and the best ones will also have an ability to do custom integrations when merchants are using their own platform or one the fulfillment center hasn’t integrated with yet.

In addition to shopping cart integrations, the technology offered from the 3PL also refers to the portal they offer to their clients to allow them to monitor orders, inventory levels, edit and cancel orders, view sales data, receive automated alerts, and more.

The reason that I ranked technology higher for smaller businesses is that, rather than using the system offered from their fulfillment company, larger businesses with high order volume will often use their own system to manage orders and inventory. With smaller businesses, this type of system may not be required or may be too cost-prohibitive and, therefore, they lean more heavily on the technology offered by their fulfillment center.

Pricing

With as cutthroat as ecommerce is, there’s no denying that the price you pay for order fulfillment is important, regardless of your volume.

That said, the reason it’s lower on my priority list for smaller sellers is that, if you’re doing 100 orders per month vs. 10,000 orders per month, a $0.10 difference in the cost per order is less impactful in aggregate.

Additionally, for smaller sellers, as they’re trying to grow their brand and their business, it is important to ensure that every order is 100% correct. After all, your early customers will likely be your early brand advocates that help you grow your business. Therefore, from this perspective, paying a bit more per order (as long as the numbers still work for your bottom line) may make more sense if it means you get a higher level of service, and this could be said for larger sellers, as well.

Location

What is the best location for your fulfillment center?

Similar to pricing, for larger sellers, the location may have a more significant impact on the bottom line. For example, if a large seller fills orders from California and 50% of their orders are east of the Mississippi, the added cost they pay for those higher-zone shipments will add up more than a seller with lower volume.

Additionally, depending on the size, weight, and quantity of their products, it may make sense for certain sellers to split their inventory across multiple distribution centers. For others, splitting inventory does not make sense as the order volume or the product catalog does not support the added carrying costs, added inbound logistical costs, nor the added tax issues.

Ownership

Lastly, ownership is something that you may not initially think about when searching for the right 3PL partner, but it’s important.

One reason for this is that, if your 3PL is a mega-corporation, there will likely be less flexibility when it comes to all of the things I mentioned above. Another reason is that ownership also relates to control and financial stability.

Many order fulfillment companies out there do not actually own or control all aspects of their operation. For example, they may lease space within another company’s warehouse, and actually use that other company’s staff to fill your orders, meaning they have less control and their client support staff is actually at a different location. While this can work, it can also lead to consistency issues and those related to response times.

Financial stability is another important factor. With the growth of ecommerce, there are many new 3PLs popping up. Given that you’re trusting your 3PL with what may be thousands or tens of thousands of dollars worth of merchandise, you want to be sure they’re not at risk of going out of business or owing big money to creditors. The best fulfillment centers are willing to share reports related to financial risk and creditworthiness.

Fulfillment Center Video

You may feel there’s some bias here given that eFulfillment Service (EFS) is a third-party fulfillment company, although, over the past several years, I’ve had hundreds of conversations with ecommerce merchants of all sizes, from startups to established, multichannel sellers. I’ve heard their stories and experiences and have gotten to know what they’re looking for, so I’ve tried to view this honestly from their perspectives.

So that you can better get to know EFS, I have provided the video below which showcases some of the best things about our family-owned and operated fulfillment center.

Video: Get to Know eFulfillment Service

Summary

Article Name

Best Fulfillment Centers & Services for Ecommerce

Description

The best fulfillment centers all have one thing in common. Learn how to choose the right third-party logistics (3PL) company for your ecommerce business.